Sales tax change

Governor Rick Snyder has signed legislation into law that will effectively give buyers of new vehicles, RV’s and boats a tax break when they trade-in an old vehicle or boat. The bills discontinue charging sales tax on trade-in vehicles and boats, when a new purchase takes place. However the break will be phased-in over a 24-year period for vehicles. In the first year, the first two thousand dollars of a motor or recreational vehicle’s trade-in value would be exempted. That means a savings of 120-dollars. The exemption amount will rise by 500 dollars per year, until it caps at 14-thousand dollars. When the tax cut is fully phased in, taxpayers will save an estimated $300 million a year. Those purchasing boats would immediately see the full value of the trade-in exempted from the sales tax. The measure takes effect December 15th. (MRN)